Published 12:01 pm, Wednesday, October 8, 2014

Following an extremely difficult spring and summer, sales tax revenues recorded a strong rebound throughout the Herald’s readership area in the October report, released Wednesday.

Eleven of the 15 cities and counties in the Herald circulation area that collect local sales tax reported higher revenues for the latest reporting cycle, which covers retail sales in August that are reported to the state in September. That was the same margin as last month.

“Significant growth in sales tax revenues occurred across all major economic sectors, reflecting strength in both business and consumer spending,” Texas Comptroller Susan Combs said Wednesday in reporting the numbers. “The gains were led by remittances from the oil and natural gas-related and manufacturing sectors, as well as from restaurants and retail trade.”

Statewide, sales tax revenue in September was $2.17 billion, up 7.9 percent compared to September 2013.

The strongest gains from a year ago were posted by Kress, 516%, Petersburg, 68%, Silverton, 48%, Castro County, 45%, and Olton, 30%. Voters in Petersburg and Olton last fall approved increasing sales tax rates, which can account for some of the increase, with renewed construction involving wind energy development and electrical transmission lines can account for some of the increase.

Following a similar increase a month ago, Plainview Chamber of Commerce Executive Director Linda Morris observed that “anything up when it comes to revenue is good.”

“In reality, we are continuing to see a trend of retail sales activity going up, which indicates that positive things are beginning to happen.”

And with grain and cotton yields expected to be significantly higher due to the easing of drought conditions, this year’s harvest is expected to bring more money into local circulation.

“It may be a bit slow right now, but we are seeing marked improvements in the areas as wind energy, oil activity and retail,” Morris said in September following last month’s release of sales tax numbers. “And many of these new jobs will be at higher pay scales, which means that the median household income will be going up. That, in turn, means more disposable income for our local residents.”

For the year-to-date, the data is a little less lopsided, but still in positive territory. Nine entities within the Herald readership area had positive numbers while six are showing declines. The largest increases where shown by Kress, 83%; Petersburg, 54& Olton, 37%; and Swisher County, 27%. The largest declines were posted by Edmonson, 48%; Abernathy, 30%; Castro County, 20%; and Floydada, 14%.

Taking a look at a similar year-to-date loss in September, Abernathy City Manager Mike Cypert said, “We’re really back to normal. A year ago we were going to town on sales tax numbers.” City leaders never learned why sales tax collections soared over the course of several months in 2013 since they are not privy to individual reports from merchants, but collections have returned to historic levels.

“Since we realized that the spike in collections was an anomaly, we did not factor the larger revenues into our budget,” Cypert said. “In fact, we budgeted for even less than we are collecting now simply out of caution.”

Despite the drop in sales tax revenues, Cypert said economic activity is on the upswing in Abernathy with work already under way on Golden Spread Cooperative’s Elk Station, which is adjacent to the existing Antelope power plant.